Westminster Policy News & Legislative Analysis

2026 Boiler Upgrade Scheme Amendment Adds Thermal Energy Storage

The Boiler Upgrade Scheme (Amendment to the Energy Act 2008 etc.) Regulations 2026 came into force on 22 October 2026, one day after being made. Signed by Parliamentary Under-Secretary of State Martin McCluskey, the instrument makes two targeted legal changes rather than a wider redesign of low-carbon heat policy. According to the text published on legislation.gov.uk and the accompanying explanatory note, the first change amends section 100 of the Energy Act 2008. The second makes drafting adjustments to the Boiler Upgrade Scheme (England and Wales) Regulations 2022, with the stated aim of clarifying how recovery powers operate under the scheme.

The amendment to the Energy Act 2008 inserts thermal energy storage systems into the list in section 100(4). The wording is narrow: the stored energy must come wholly or partly from a renewable source. That keeps the provision tied to renewable heat support rather than extending it to every form of heat storage. In policy terms, this matters because section 100 is the enabling power used for renewable heat incentives. By naming thermal energy storage systems directly in the Act, the Government has created a clearer statutory basis for future support mechanisms or scheme design involving storage alongside renewable heating technologies.

The territorial scope is split between the two operative provisions. Regulation 2, which amends the Energy Act 2008, extends to England and Wales and Scotland. Regulation 3, which amends the Boiler Upgrade Scheme regulations, extends only to England and Wales. The preamble also records the formal steps behind the instrument. A draft was laid before Parliament and approved by both Houses under the affirmative procedure. The Secretary of State obtained the consent of the Scottish Ministers for the relevant provision and consulted the Welsh Ministers on the amendment affecting England and Wales.

The changes to the Boiler Upgrade Scheme are more administrative than structural. Regulation 22 of the 2022 rules has been amended so that the scheme administrator may take one action, or a combination of actions, when seeking to recover sums due under the scheme. The amendment also adds an express limit. Where more than one recovery route is used, the total amount sought must not exceed the sum of the payments due. That gives the administrator clearer legal footing while also making the ceiling on recovery explicit in the regulations themselves.

A further drafting change updates the notice requirements in regulation 22. The text now refers to 'any' action rather than 'either', and notices must state, where relevant, the amount that must be repaid and the amount that will be recovered by offsetting. This is a technical amendment, but it improves precision around how recovery decisions are communicated. The explanatory note does not suggest any change to the basic purpose of the Boiler Upgrade Scheme. As set out in the 2022 regulations, the scheme supports eligible heat pumps and biomass boilers for space and water heating in domestic properties and small non-domestic properties, provided the installation does not replace an existing renewable heating system.

The explanatory note states that no full regulatory impact assessment has been prepared because no impact on the private or voluntary sectors is foreseen. That indicates the Government views the instrument as a limited legal and administrative update rather than a change to grant rates, headline eligibility or overall scheme ambition. Even so, the practical significance should not be dismissed. From 22 October 2026, thermal energy storage has a firmer place within the Energy Act 2008 framework, and the Boiler Upgrade Scheme administrator has clearer rules on combining recovery actions and setting out repayment and offsetting amounts. For installers, advisers and scheme participants, the change is chiefly about legal certainty and cleaner administration.